Bitcoin Crashes Hard After Second Largest Chinese Exchange Announces Shutdown

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Just a day after JPMorgan Chase CEO Jamie Dimon unleashed a fury of attacks on Bitcoin (and cryptocurrencies in general), another salvo is incoming. It was reported last week by Caixin that China was contemplating shutting down cryptocurrency exchange trading, and further confirmation of that order arrived today.

The news sent Bitcoin into another tailspin, extending its losses for a fifth straight day, its longest losing streak in over a year. BTC China, the second largest exchange in China, announced that as to today, it will no longer accept new user registrations. It also announced that the exchange will halt all trading effective September 30th, 2017.

In a statement issued today, BTC China indicated:

According to the September 4 issue of the "People's Bank of China Central Office of the Ministry of Industry and Information Technology Ministry of Industry and Commerce, China Banking Regulatory Commission, China Securities Regulatory Commission on the prevention and treatment of the risk of the issuance of the currency," the spirit of the document, adhering to the protection of investment risks, the maximum protection of users.

However, not everyone feels that this is the end for Bitcoin exchanges in China. Chamber of Digital Commerce chairman Matt Rozak seems convinced that BTC China will reverse its decision, perhaps before the new year kicks off. “China is preparing to provide licensure for less than a handful of exchanges as it grapples with the meteoric increase in cryptocurrency trading," said Rozak in a statement to Bloomberg News. "And speculation on ICOs -— licensure and engagement with government will help propel this industry forward.”

China is currently responsible for roughly 40 percent of global Bitcoin trading volume. However, many Chinese government agencies are more concerned that initial coin offerings (ICOs) have become a breeding grounds for financial scams, illegal fundraising, and other illicit schemes.

Bitcoin is down over $500 today to around $3,350, which is well off its record high earlier this month. Bitcoin hit a record high of just over $5,000 in intraday trading on September 2nd.

Top image courtesy Atana/flickr